2021
DOI: 10.21833/ijaas.2021.03.009
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Formality and investments: Evidence of Vietnamese SMEs

Abstract: Business formality is considered a key driver in the development of the private sector in developing countries, which can contribute to enhancing the capacity and competitiveness of firms. The purpose of this paper is to investigate the impact of formality on investments of small and medium-sized enterprises (SMEs) in Vietnam. Different from previous work, we apply a two-stage method with random-effects Probit and Tobit regressions to control for endogeneity surrounding formality and investments. Results show … Show more

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Cited by 2 publications
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“…Therefore, if the normal linear regression model is applied to evaluate the impact on the performance of the firm, the obtained estimators will be biased and unstable. To solve such problems, it is appropriate to apply the Tobit regression model (Cameron and Trivedi, 2009;Ling et al, 2018;Phan and Hien, 2021). In this study, Stata 16 is used to conduct Tobit regression for the data of 170 Vietnamese seafood processing firms from 2013 to 2018, the model is set up as follows:…”
Section: Methodsmentioning
confidence: 99%
“…Therefore, if the normal linear regression model is applied to evaluate the impact on the performance of the firm, the obtained estimators will be biased and unstable. To solve such problems, it is appropriate to apply the Tobit regression model (Cameron and Trivedi, 2009;Ling et al, 2018;Phan and Hien, 2021). In this study, Stata 16 is used to conduct Tobit regression for the data of 170 Vietnamese seafood processing firms from 2013 to 2018, the model is set up as follows:…”
Section: Methodsmentioning
confidence: 99%